The New Mexico Industrial Energy Consumers (NMIEC) was one of the original supporters of both the Renewable Energy Act (REA) and the Efficient Use of Energy Act (EUEA).  This support demonstrates NMIEC’s long term commitment to ensuring that New Mexico remains on the forefront of new developments in the energy sector.

 

At the same time, NMIEC has consistently litigated and lobbied for reasonable, affordable energy rates for all consumers.  NMIEC believes that utility-sponsored renewable energy projects and energy efficiency programs must be given the same exacting scrutiny as utilities’ development of traditional resources.  In these difficult economic times especially, it is essential that every dollar contributed by the consumers to the development of renewable resources and energy efficiency programs be used by the State’s utilities in a manner that maximizes the impact of those dollars.

 

NMIEC also believes that customer initiated projects and programs are often more effective than those administered by the State’s utilities.  For this reason, the opportunities for customer initiated projects, which are recognized as legitimate options under both the REA and the EUEA, should be fully explored by its Members and encouraged by the regulatory authorities.

 

The following statements of regulatory principles embody these policy objectives.

 

NMIEC POSITIONS ON RENEWABLE ENERGY ISSUES

1)      THE REASONABLE COST THRESHOLD (RCT) WAS INTENDED BY THE LEGISLATURE TO ENSURE THAT THE COST OF RENEWABLE RESOURCES REMAINS AFFORDABLE FOR ALL CUSTOMERS.  THE RCT SHOULD BE REGARDED AS A BUDGET THAT LIMITS UTILITY EXPENDITURES.

 

2)      NMIEC OPPOSES CURRENT EFFORTS TO INCREASE THE RCT BEYOND ITS CURRENT MAXIMUM LEVEL OF 3% OF CUSTOMER’S BILLS.

 

3)      THE REA SHOULD BE AMENDED TO ALLOW GOVERNMENTAL ENTITIES SUCH AS SCHOOLS AND  MUNICIPALITIES TO TAKE ADVANTAGE OF THE LARGE CUSTOMER CAP OF 2% OR $100,000.

 

4)      GOVERNMENTAL CUSTOMERS SHOULD BE ABLE TO BANK EXPENDITURES ON SELF-BUILT PROJECTS TO MEET THE 2½% RATE CAP IN SECTION 62-16-4.A(3).

 

5)      UTILITIES SHOULD USE THE RESOURCES WITH THE LOWEST REASONABLE COSTS TO SATISFY THE RENEWABLE PORTFOLIO STANDARD (RPS).  THIS APPROACH INCLUDES THE FULL USE OF AVAILABLE RENEWABLE ENERGY CERTIFICATES (RECs).

 

6)      THE RCT CALCULATIONS FOR EACH UTILITY SHOULD INCLUDE ALL RENEWABLE RESOURCES PROCURED BY THAT UTILITY.  FOR EXAMPLE, PNM’S CONTRACT FOR 200 MW FROM THE NEW MEXICO WIND CENTER SHOULD BE INCLUDED WHEN DETERMINING WHETHER ITS EXPENDITURES ARE WITHIN BUDGET.

 

7)      FOR TRANSPARENCY PURPOSES, THE COSTS OF RENEWABLE RESOURCES SHOULD BE SHOWN AS A LINE ITEM ON THE  CUSTOMER’S BILL.

 

8)      THE COMMISSION’S RENEWABLE ENERGY RULE MUST BE REVISED TO ALLOW THE USE OF MULTIPLIER THAT REFLECT THE COST DIFFERENTIALS BETWEEN VARIOUS RENEWABLE RESOURCES.

 

9)      AVOIDED COST CALCULATIONS USED TO DETERMINE THE TRUE COST OF A UTILITY’S RENEWABLE PORTFOLIO SHOULD REFLECT ONLY THOSE COSTS THAT ARE ACTUALLY AVOIDED BY CUSTOMERS AND SHOULD BE UPDATED ANNUALLY.

 

NMIEC POSITIONS ON ENERGY EFFICIENCY ISSUES

1)      UTILITY-SPONSORED ENERGY EFFICIENCY (EE) PROGRAMS MUST BE REVIEWED ANNUALLY TO ENSURE THAT THE TOTAL RESOURCE COST (TRC) TEST CALCULATIONS USED IN THE APPROVAL PROCESS ARE STILL ACCURATE.  THIS PROCESS MUST EMPLOY THE MOST RECENT AVOIDED COST CALCULATIONS, WHICH ARE BASED ON HISTORICAL DATA.

 

2)      THE COMMISSION SHOULD DIRECT SCARCE RESOURCES TO THOSE EE PROGRAMS THAT PROVIDE THE HIGHEST RETURN FOR THE DOLLAR INVESTED.

 

3)      UTILITIES SHOULD BE ENCOURAGED TO PARTNER WITH INDUSTRY WHEN DESIGNING LARGE CUSTOMER EE PROGRAMS.

 

4)      INCENTIVE RATES SHOULD BE APPROVED ONLY IF THE UTILITY CAN DEMONSTRATE THAT ITS PROGRAMS HAVE BEEN DEMONSTRATED TO HAVE ACHIEVED EXCEPTIONAL PERFORMANCE

 

5)      INCENTIVE RATES FOR EE PROGRAMS CAN ONLY BE APPROVED IN THOSE INSTANCES WHERE THE UTILITY HAS INVESTED ITS OWN CAPITAL IN THOSE PROGRAMS.

 

6)      DECOUPLING RATES ARE ANTI-CONSUMER AND SHOULD NEVER BE ADOPTED.